Introduction Like Information & Communication Technology (ICT) and biotechnology, nanotechnology is a generic, platform technology with potential applications in many industrial sectors. Given the worldwide impact of ICT and biotechnology, and the announced glory of nanotechnology, it is no wonder that both developed and developing countries with established scientific capabilities are plunging to take part in the nanotechnology race — following the lead of the US in terms of high-public investment. However, the players have started the race at substantially different times. Furthermore, they do not have the same knowledge base, equipment, or scientific and technological capabilities; and the opportunity cost of every unit of funds diverted into this endeavor is higher for developing countries with a high poverty burden. In such a context, how should a developing country like India attempt to compete in the nanotechnology race? What are the trade-offs between the different trajectories for catching up? These are the questions that we explore in this chapter. The “catch-up” literature of the evolutionary school of economics refers to a stream of rich and well documented historical case studies on the “catching up” processes of follower countries to build industrial capabilities. One of the factors repeatedly noted in these works as having been favorable to the catch-up process in knowledge intensive sectors, is the international and sectoral diffusion of technology i.e., a quasi-free access to international knowledge pools.